The actual worth of goods and services in the world last year was over $71 trillion, a staggering jump from over $41 trillion in 2000. If that’s the case, how is it that the amount of money in the world – coins, paper and digital – is ten times that or more? With such excess, why are 2 billion still hungry, poor, jobless or underemployed?
What happens when some have too much and most have too little money? When a minority of people have several hundred or thousand-fold more than others, they buy up most of everything, create monopolies and cartels, arbitrarily raise prices and make undue, excessive profits while the majority do with less than their fair share, or go without entirely. They have money enough to lobby and influence politics, government and legislation, and unwarranted control over or privatisation of ‘commons’ lands and public goods, leading to loss of social and economic services for the masses. Why is such excess purchasing power allowed when it causes heightened and unacceptable inequalities and damaging inflation?
If we really believe in things like human and constitutional rights, democracy, Islamic finance, and equal rights and opportunities, and acknowledge that all natural resources are essential for survival, and all are therefore entitled to an adequate share each, there then has to be a mechanism to ensure fair distribution of minimum needs for all citizens.
That facilitator is money, which today no longer has to be backed by gold or silver or other commodity; it just needs to be guaranteed and reliable.
Various types of positive financial services have successfully served the “little people” in many other countries for at least a century. When dire economic straits occurred, such as in Argentina, Iran, even USA and UK, and most recently in Greece, apart from rioting and protests, did people just curl up and die because they had no cash? No, necessity being the mother of invention, some innovated or revived old, tested solutions known as complementary or community currencies.
It is best illustrated by one of the most famous success stories. In 1932, Wörgl, a small Austrian town, was in dire straits. There were 1,500 jobless and 200 impoverished, penniless families. But Michael Unterguggenberger, Wörgl’s brilliant Mayor, decided to test out the ideas of Silvio Gesell, a German economist and activist. He issued scrip (free of cost except for printing) with an exchange value of 40,000 schillings, and spent the money into circulation through public works that created huge employment. All the broken roads were repaved, the water system rebuilt, a ski jump, new houses, and more made; even a bridge, commemorated with a permanent plaque that proudly states: “This bridge was built with our own ‘free’ money.”
As it turned out, every scrip generated 12 to 14 times more employment than the official schillings in circulation. It was so successful that a neighbouring city and six villages copied it. The then Prime Minister of France specially visited to see the “Miracle of Wörgl” for himself. A year later, 200 other Austrian towns planned to replicate it.
At this point, the Central Bank grew alarmed and asserted its monopoly over the finance system, even though each scrip was restricted to community use. The people sued the central bank, but lost. It was an unfortunate dog-in-the-manger attitude, refusing to assist people who needed help, but also thwarting the people from helping themselves.
Since then, there have been many other such examples – but with happier endings, some with government tolerance if not backing. A virtually costless solution for people denied the right to paid work and money.
Today, there are over 2,500 complementary and community currencies around the world. There are small service charges, but no crippling interest. There have always been poor and low-income or the temporarily cash-strapped; alternatives were developed according to local needs. The tokens are not national legal tender, and not allowed outside delineated areas of operation. Yet, they are being resorted to increasingly, to overcome the marginalisation of the masses by banks or inept governments.
In recent decades, answering a need, they have grown in popularity and use. Just a few weeks ago, the 2nd International Conference on Complementary and Community Currency Systems took place in the Netherlands, addressed by academics, economists, public bankers and activists. Other such meetings are forthcoming this year in UK and USA. Since 2002 – long before the global financial crash – some local currency schemes in Europe under certain conditions are exchangeable with national currency.
Some schemes are for the express purpose of local food production and re-localisation of purchasing. If and when they are no longer needed, they can be easily phased out. It is the sort of thing our women and our peasants need until they are “mainstreamed” into the wider economy.
In a country such as ours where there is inadequate infrastructure for most services, this would ideally be carried out by trusted civil service organisations as they have been elsewhere. Micro-credit philanthropies need to study complementary/community currency possibilities because the money they use still carries an in-built interest burden, while microcredit banks charge heavy interest like any other bank; they serve individuals rather than communities, and only to a limited extent.
Commercial banks are limited by their own for-profit-only existence, lending only to those who pay back with interest; and certain self-serving transactional practices that have corrupted part of the wider banking world, in the end failing most people, especially of the developing world.
The scheme requires no major infrastructure, and it certainly does not require foreign loans, that would be undesirable and defeat the purpose. There is one proviso though. It has to be operated with transparency and honesty. Success stories came from maintaining open, audited books and public participation. If corruption or political advantage intrude, it will collapse before take-off.
The question is: why didn’t Pakistan adopt such solutions earlier? Mainly because our politicians and decision-makers couldn’t care less; nor do they want to empower people, who may become the competition or reduce their domination – as in the case of land reform. The “highly-qualified” are so inward-looking, even brainwashed by World Bank/IMF norms, they don’t even look at today’s easily accessible global information, to learn from outside.
It first needs the realisation that money is merely a measure – a medium of exchange and accounting device – and that it does ‘not’ have to be borrowed or be earned first before it can be spent. Nor is it a special knowledge that only bankers and controlling governments can understand.

This site is still under contruction.

Najma Sadeque’s writings will continue to be added as they come up. Since she never maintained a record, one is faced with the difficulty of finding texts going back some 35 years. This is a request to readers to kindly let me know if they know of any records. An estimated thousand or so are missing. Your help would be appreciated. Thank you. – denebsumbul@gmail.com